Message to the Nation

It is with great pleasure that I present to you the fiscal year 2012 Annual Performance Report of the Minority Business Development Agency (MBDA). MBDA helps to create jobs by supporting the growth and global expansion of U.S. minority- and diaspora-owned businesses ("the Sector" or "MBDA target companies"). MBDA target companies are fast-growing, innovative, and represented in every industry sector in the United States. These companies contribute over $1 trillion in annual economic output to the U.S. economy and according to the U.S. Census Bureau, directly account for nearly 6 million U.S. jobs. Moreover, these businesses lead the Nation in companies poised to export U.S. goods and services. With unique export capabilities, MBDA target companies are twice as likely to export as non-target companies and three times as likely to have international operations. Anecdotal evidence suggests that these companies may begin exporting earlier in their business cycle than non- Sector companies, and may be less likely to leave a foreign market during an economic downturn. (See page 21 for a more detailed overview of the global competitive advantages of MBDA target companies.) These and other factors continue to increase the relevance of MBDA as a critical Federal Government agency that supports the creation and retention of much needed jobs.

I am proud to report that fiscal year 2012 was another highly successful year for the Agency, the U.S. Department of Commerce, and the American people. In fiscal year 2012, MBDA helped create and retain 16,730 jobs, the highest level in the 44 year history of the Agency. This was achieved by helping MBDA clients obtain over $3.6 billion in contracts and capital awards. Fiscal year 2012 anchors an Obama Administration total of $14.6 billion in contracts and capital for MBDA clients, making this the highest 4-year performance in the history of the Agency. This performance represents a full 108 percent increase in contracts and capital awarded to MBDA clients over the prior 4-year period. I applaud our MBDA Business Center operators and staff for another year of outstanding performance. Return on taxpayer investment, the Agency's primary measure of internal operating efficiency, was 126x in fiscal year 2012. This remains above the average compared to the prior 4-year period, despite a more difficult economic period.

In fiscal year 2012, MBDA completed an Agency-wide restructuring that began three years earlier. This restructuring allowed the Agency to centralize operations in Washington, DC and transition to a new operating model that is MBDA Business Center-focused and global in scope. The process of restructuring a Federal Government agency is both time-consuming and difficult, but it was achieved with minimal interruption to Agency operations. While certainly a team effort, this restructuring would not have been possible without the dedication and leadership of National Deputy Director Alejandra Castillo, Chief of Staff and Associate Director for Management, Edith McCloud, and Administrative Officer Roberto Lopez. I applaud them and their teams for this outstanding achievement.

Despite the challenges of the restructuring, the Agency was able to further expand its national footprint, launching new MBDA Business Centers in Anchorage, Alaska; Fresno, California; Santa Fe, New Mexico; Bismarck, North Dakota; Memphis, Tennessee; and Tulsa, Oklahoma.

MBDA completed the transition of our Atlanta MBDA Business Center into an Advanced Manufacturing and Healthcare Technology Specialty Business Center. In addition, the Agency increased its global support capability by executing a new alliance with the Export-Import Bank of the United States; and continued to provide strong support for Department of Commerce and White House initiatives, including the rebuilding efforts after Hurricane Sandy; the National Export Initiative; the Strong Cities, Strong Communities Initiative; and the Interagency Task Force on Small Business Contracting.

MBDA's tremendous success in fiscal year 2012, and over the last four years, would not have been possible without the commitment of the senior management team and staff. Fiscal year 2012 was a year of tremendous change for MBDA, allowing the Agency to lay a foundation for greater access to global markets and greater economic opportunities for all Americans.

David A. Hinson
National Director

Introduction

For 44 years, the Minority Business Development Agency (MBDA or "the Agency") has led Federal Government efforts to provide focused support to a critical sector of the U.S. economy — privately held companies owned and operated by members of the Nation's minority and diaspora* communities. These companies contribute to local economies and provide much needed jobs for Americans of all backgrounds and cultures. They operate in urban centers and rural communities. They create jobs in the chemical and advanced manufacturing facilities of Puerto Rico and in the agricultural belt of California. They operate in the energy service sectors of Alaska and North Dakota and the international trade hubs of Texas and Florida.

Currently exporting to over 60 nations, MBDA target companies have the skills and relationships that make them some of the most effective exporters in the U.S. economy. These companies are twice as likely to export, three times more likely to boast international operations, and six times more likely to transact business in a language other than English.A Indeed, the future of U.S. exporting and the creation of export-related jobs will rely heavily on the ability of MBDA target companies to grow and prosper.

Supporting the Growth of Large and Medium-Sized Job Creating Companies

Contrary to the belief of some, companies within the minority and diaspora-owned sector are not all small. Many have substantial private-market valuations and some generate well over a billion dollars in annual revenue. Hispanic-owned MasTech Corporation and Goya Foods, Alaska Native-owned Nana Development Corporation, and African American owned Worldwide Technologies and Act1 are just a few of MBDA target companies that have achieved the billion dollar revenue level and many more are on the cusp of achieving this level of performance. In addition, regardless of size, MBDA target companies have been the source of significant job creation, innovation and entrepreneurship. From the original Bowflex® home exercise equipment (a former MBDA client) to many Silicon Valley technologies, Agency clients and target companies have contributed countless improvements and conveniences to American life.

The minority- and diaspora-owned business sector is also growing at a phenomenal rate. According to the most recent data from the Census Bureau, the growth of minority-owned businesses outpaced non minority counterparts in gross receipts, employees, and number of firms,A while among women-owned businesses, Latina-owned firms are the fastest growing in terms of new business formation.

Removing Impediments to Job Creation and Reducing the Wealth Gap

Despite the spectacular growth of the minority-owned and diaspora-owned business sector and its increasing contribution to the U.S. economy, many have failed to grasp its importance to the long-term economic security of America. Sector businesses still face unnecessary impediments to growth that limit their potential for new job creation. Studies show that MBDA target companies are less likely to obtain capital, whether debt, equity, or surety bonding, than non-Sector corporations.J In addition, these companies are awarded far fewer contracts opportunities, whether public sector or private sector, than their company size, product offering, or management capability would suggest. This limits their ability to add economic value to the U.S. economy and their ability to help reduce the wealth gap. Given that the growth sector of U.S. companies is MBDA's target sector, it is critical that the public and private sector work more closely together to ensure the value these companies bring to the U.S. economy is not constrained.

The Minority Business Development Agency exists to ensure this vital and thriving sector of the American economy operates on a level playing field so it can do its share to fuel the continued recovery of the American economy. This cannot happen until diverse businesses operate within an environment in which everyone benefits from playing by the same rules.

*The term diaspora is commonly defined as "any group that has been dispersed outside its traditional homeland."

FY2012 Performance Highlights

FY2012 CONTRACTS AND CAPITAL BY SECTOR SOURCE

PUBLIC SECTOR

PRIVATE

FEDERAL GOVERNMENT

STATE GOVERNMENT

LOCAL GOVERNMENT

NOT DISCLOSED

TOTAL

Dollar Value of Contracts

$1,321,187,391

$494,577,146

$220,038,665

$170,300,198

$1,678,856

$2,207,782,256

Dollar Value of Capital

$1,249,061,949

$101,704,125

$11,962,775

$13,189,728

$774,000

$1,376,692,577

TOTAL DOLLAR VALUE

$2,570,249,340

$596,281,271

$232,001,440

$83,489,926

$2,452,856

$3,584,474,834

Number of Contracts

878

286

62

128

20

1374

Number of Capital Transactions

823

75

14

10

2

924

TOTAL TRANSACTIONS

1701

361

76

138

22

2,298

FY 2012 CONTRACTS BY INDUSTRY

AMOUNT

Agriculture, Forestry, Fishing & Hunting

$13,421,259

Construction

699,876,860

Finance, Insurance & Real Estate

23,879,812

Information

15,878,017

Manufacturing

810,719,860

Mining

32,195,285

Retail Trade

23,449,496

Services

265,622,424

Transportation, Warehousing & Public Utilities

62,352,712

Wholesale Trade

260,386,431

TOTAL

$2,207,782,256

Performance by Ethnic Business Community

MBDA was created to level the playing field for minority entrepreneurs so that America could benefit fully from the diverse backgrounds, experiences, and outlooks that this sector contributes to the Nation's economy. The Agency has empowered millions of businessmen and businesswomen to realize their entrepreneurial goals and create jobs that keep the country strong. The following information illustrates the impact that MBDA has had in four of the client communities it serves.

Asian American-Owned Businesses

In FY 2012, MBDA helped 1,630 Asian American-owned businesses access $268 million in contracts and capital. During the first term of the Obama Administration, MBDA assisted 2,399 Asian American owned businesses in obtaining $523 million in contracts and capital — an 88 percent increase over the prior 4-year period.

Quick Facts about the Asian American Business CommunityA

1.5 million Asian American-owned firms in the U.S.

26 percent have paid employees (averaging 7 per firm), and average over $1.1 million in annual receipts.

2.8 million jobs created by Asian American-owned businesses.

Asian American community has $508.6 billion in buying power nationwide.

Exports and Global ReachC

Asian American-owned firms that export average $7.5 million in annual receipts, compared to their non-exporting counterparts who average $327,000.

Exports average 16 percent of total revenue for Asian American exporters, compared to 5.5 percent for all U.S. firms with exports.

6.8 percent of Asian American-owned firms export goods and services, compared to 3.2 percent of all U.S. firms. exporters, compared to 5.5 percent for all U.S. firms with exports.

Foxit Corporation Leads Industry in Document Solutions

Eugene Y. Xiong was determined to get a piece of the American dream despite an extremely limited command of the English language and even less understanding of U.S. small business financing. But against the odds and with assistance from MBDA, his company – Foxit Corporation – was born.

Today, the Foxit Corporation generates $7 million in annual revenues and has offices in the U.S., China, Japan, Taiwan, Korea, and France. The company's global expansion was with the direct assistance of MBDA.

Xiong was referred to MBDA after failed attempts to obtain bank financing. "Our banker recommended MBDA to us," Xiong said. "MBDA continues to work with us on banking and financial services."

"When we were tight on cash flow, MBDA helped us find the right banking service and we got the right cash that we needed to grow our business," he said."

According to Xiong, Foxit Software Company is the industry leader in the OEM licensing of industrial standard electronic document solutions included in ISO 32000 PDF. In 2004, Foxit launched Foxit Reader, a small and fast PDF document viewer and Foxit's desktop software, Foxit PDF Editor. In addition to taking on Adobe, Xiong partnered with Amazon.com to develop pdf readers for Kindle devices.

African American-Owned Businesses

In FY 2012, MBDA helped 1,438 African American-owned businesses access $1.8 billion in contracts and capital. During the first term of the Obama Administration, MBDA assisted 8,656 African American owned businesses in obtaining $7.4 billion in contracts and capital — a 178 percent increase over the prior 4-year period.

Quick Facts About the African American Business CommunityA

1.9 million African American-owned firms in the U.S.

6 percent have paid employees (averaging 9 per firm), and over $911,000 in annual receipts

This sector generates $136 billion in annual economic output

910,000 jobs created by African American-owned businesses

Exports and Global ReachC

African American-owned firms that export an average $8.1 million in annual receipts, compared to their non-exporting counterparts who average $64,000.

Exports represent an average of 5.1 percent of total revenue for African American-owned exporting companies, compared to 3.2 percent for all U.S. firms with exports.

MBDA Client on the Fast Track for High Speed Rail Contracts

To look at MBDA client Enviro AgScience Corporation's sprawling 12- acre campus in Columbia, South Carolina, it may be hard to believe that this African American-owned business started as a commercial lawn care company.

Founded by Dr. Louis B. Lynn in 1985, ENVIRO now offers prime contracting, general construction, and construction management, in addition to large-scale commercial landscaping. Although ENVIRO is a client of the Columbia MBDA Business Center, Dr. Lynn recently took advantage of MBDA's integrated network by working with the Atlanta MBDA Business Center to expand into Georgia markets.

Dr. Lynn is now preparing for contracting opportunities with the California High Speed Rail project. "I never imagined when I started my business almost 30 years ago that it would grow like it has," says Dr. Lynn.

Hispanic American-Owned Businesses

In FY 2012, MBDA helped 1,113 Hispanic American-owned businesses access $866 million in contracts and capital. During the first term of the Obama Administration, MBDA assisted 6,305 Hispanic American owned businesses in obtaining $4.4 billion in contracts and capital — an 86 percent increase over the prior 4-year period.

Quick Facts about the Hispanic American Business CommunityA

2.6 million Hispanic American-owned firms in the U.S.

11 percent have paid employees (averaging 8 per firm), and over $1.1 million in annual receipts

This sector generates $351 billion in annual economic output

1.9 million jobs created by Hispanic American-owned businesses

Exports and Global ReachC

Hispanic American-owned firms that export average $2.3 million in annual receipts, compared to their non-exporting counterparts who average $124,000.

Exports average 5.5 percent of total revenue for Hispanic American owned firms that export, compared to3.2 percent for all U.S. firms that export.

7.2 percent of Hispanic American-owned firms export goods and services, compared to 3.2 percent of all U.S. firms.

MBDA Client with 100% Revenue from Exports

TIG/m, a California railcar manufacturer, generates 100 percent of its revenue from exports. The company was founded by Alvaro Villa, who came to the U.S. as a teenager. He started TIG/m after a career with Disney where he specialized in robotics. With his first entrepreneurial endeavor, AVG Productions, Mr. Villa established a reputation for quality robotic amusement rides and attractions. As trains are an integral part of most amusement park attractions, his transition to railcars came quite naturally.

Having started his first company in a workshop about the size of a two-car garage, Mr. Villa now oversees railcar production at his 40-thousand square complex amid the rolling hills near Valencia, California. With a reputation for quality and authenticity, and being one of few remaining railcar manufacturers in the U.S., his plant is regularly visited by transit officials and organizations such as the American Public Transit Association.

TIG/m began 2012 with about $1 million in annual revenue, which tripled in 2013 as a result of contracts to build four railcars for Aruba that he won with the assistance of MBDA.

Native American-Owned Businesses

In FY 2012, MBDA helped 868 Native American-owned businesses access $320 million in contracts and capital. During the first term of the Obama Administration, MBDA assisted 2,850 Native American owned businesses in obtaining $1.4 billion in contracts and capital — a 53 percent increase over the prior 4-year period.

Quick Facts about the Native American Business CommunityA

236,000 Native American-owned firms in the U.S.

10 percent have paid employees (averaging 8 per firm), and over $1.2 million in annual receipts

This sector generates $34.4 billion in annual economic output

185,000 jobs created by Native American-owned businesses

Exports and Global ReachC

Native American-owned firms with exports average

$9.7 million in annual receipts, compared to their non-exporting counterparts who average $128,000.

Exports average 2.9 percent of total revenue for Native American exporters.

MBDA Uses Expertise to Assist Bering Straits Native Corporation

The Bering Straits Native Corporation (BSNC) was formed in 1972 as the regional Alaska Native Corporation for 6,333 original shareholders in the Seward Peninsula and the coastal lands of Alaska's eastern Norton Sound. Today, the BSNC operates 17 companies, which include professional services (engineering, project management, logistics, etc.), construction, mining, and tourism. Many of BSNC's companies provide services to the U.S. Government, which prompted them to seek assistance from MBDA.

The Anchorage MBDA Business Center used its expertise in Federal Government contracting to provide BSNC with extensive research on active and awarded contracting opportunities and an analysis of its competitors to develop a comprehensive bid strategy. In FY 2012, MBDA assistance enabled BSNC to win a $1.3 million contract from the U.S. Navy for custom computer programming services.

Increasing Services For MBDA Clients

MBDA has doubled its efforts to assist Sector businesses by providing access to the financing and markets they need to expand their businesses.

In FY 2012, six new MBDA Business Centers were opened. Coupled with expanded coverage at existing locations, the Agency served over 5,740 firms in FY 2012.

Expanded Service Locations for Sector Companies

During FY 2012, the Agency grew its network of MBDA Business Centers by opening locations in: Anchorage, Alaska; Fresno, California; Santa Fe, New Mexico; Bismarck, North Dakota; Tulsa, Oklahoma; and Memphis, Tennessee. The opening of these Centers also signaled the completion of the Agency's consolidation of three distinct programs into a single, nationally networked program.

The new program eliminates geographic boundaries, giving clients the opportunity to seek support from any MBDA Business Center they choose and offers expertise in specific industries and export markets. For example, while five of the new Business Centers were launched to serve the high concentration of Native American and Alaska Native firms in their respective areas, they are now available to serve businesses owned and operated by MBDA target companies across the nation.

The Agency also provided additional funding to five existing MBDA Business Centers to serve additional geographic regions.

Boston, Massachusetts expanded its operations to serve clients in Bridgeport, CT, and extended target outreach to Native American-owned firms in the Northeast;

Chicago, Illinois expanded its reach to serve clients in St. Louis, MO;

San Juan, Puerto Rico expanded its operation to provide more service throughout the island; and

San Jose, California expanded its services to clients in San Francisco, CA.

Industry-Specific Support for Sector Companies

To be more responsive to client needs, MBDA is systematically reorganizing the MBDA Business Center network to include an increasing number of specialty centers capable of providing targeted, industry-specific support services. In this way, all companies within an industry sector can now work through one center and obtain services that have a unique industry focus.

The Atlanta MBDA Business Center has transformed to serve as the MBDA Advanced Manufacturing and Healthcare Technology Business Center, attracting clients involved in healthcare, information technology, and advanced manufacturing, by leveraging the capabilities that exist at its location, Georgia Institute of Technology. In FY 2012, 37 percent of MBDA contract awards were in the manufacturing industry sector. The Atlanta MBDA Business Center now has the resources to assist businesses around the country as they expand in the advanced manufacturing and healthcare technology industries.

MBDA has an export-focused Support Business Center located on the campus of the University of Texas San Antonio. Located in Washington, DC, the Federal Procurement Center is designed to assist MBDA target companies that seek to enter the world of federal and state government contracting. Plans are in place to add several new specialty business centers in the coming years.

Leveraging Business Community Partnerships

MBDA provides visibility and access for Sector businesses by partnering with private businesses, industry coalitions, and government agencies at the federal, state, and local levels. These efforts resulted in valuable opportunities for MBDA clients in FY 2012.

MBDA target companies, including those in the healthcare sector, contribute more than 6 million jobs and over $1 trillion in annual economic output to the U.S. economy.A

MBDA has improved access to healthcare supply chains and a mega-project in California.

MBDA Supports the Growth of U.S. Healthcare Companies

In the United States, healthcare is a $2.7 trillion industry that has steadily grown at an average annual rate of 4 percent since 1960.C It also represents one of the top industry sectors for MBDA target companies with over 13 percent in the Healthcare and Social Assistance sector. In December of 2012, MBDA and the Healthcare Supplier Diversity Alliance (HSDA) entered into a memorandum of understanding (MOU). This MOU established a partnership to increase access to healthcare procurement opportunities and to serve as a pathway to supply chains of global healthcare corporations. Additional components of the MOU include participation in the HSDA's Executive Healthcare Certificate Program facilitated in partnership with Rutgers University's Center for Management Development and Novation, a health care supply chain contractor. The program also enables MBDA healthcare industry clients to attend the annual Owens & Minor Supplier Diversity Symposium to network with healthcare supply chain executives and procurement decision makers.

MBDA joins HSDA in promoting the immense value of healthcare supplier diversity, building a stable platform for education, and expanding opportunities for minority-owned businesses. This partnership exemplifies the commitment of the Obama Administration, the Department of Commerce, and MBDA to create greater access for MBDA target companies in emerging and high growth sectors of the healthcare industry.

Greater Resources for Transportation Infrastructure Companies

On behalf of MBDA target clients in the infrastructure and building sectors, the Agency is participating in large-scale infrastructure projects, or "mega-projects." These projects are substantial job creators and infuse significant economic activity into their communities. An example of a mega-project is the California High Speed Rail Project (CHSR), which is projected to cost upwards of $68 billion and will create tens of thousands of new jobs in constructing and maintaining the system.

MBDA was on the ground from day one to ensure that MBDA target companies have access to contracting opportunities that will result from the CHSR. The Agency, along with a host of strategic partners, successfully secured a commitment for 30 percent of all contracts to be awarded to small/ minority/women-owned firms. This will ensure the broadest economic impact and highest level of job creation. MBDA National Deputy Director Alejandra Castillo, in coordination with Project Directors Daniel Sieu, Alejandro Serrudo, and David Mendoza from the Riverside, San Jose, and Fresno MBDA Business Centers, worked closely with the five CHSR prime contractors: California Backbone Builders, California High-Speed Rail Partners, California High-Speed Ventures, Dragados-Samsung-Pulice, and Tutor Perini- Zachry-Parsons, to ensure that minority-owned firms are in an equal position as other providers to compete for and win CHSR contracting opportunities.

MBDA Strengthens Relationship with OPIC to Support Greater Export Activity

The Overseas Private Investment Corporation (OPIC) works with the private sector to help U.S. businesses gain footholds in emerging markets and to create export-related jobs. OPIC provides investors with financing, guarantees, political risk insurance, and support for private equity investment funds.

For many years MBDA has worked closely with OPIC to connect its clients with the resources offered by OPIC. MBDA formalized its longstanding relationship with OPIC through a memorandum of understanding (MOU) to jointly promote projects that increase the opportunities for MBDA clients to make use of OPIC products, increase OPIC's outreach to minority-owned businesses, and increase minority participation in OPIC's programs. Given the connection that the Agency's diaspora-owned businesses already have in their former countries, OPIC delivers the resources and protection necessary to reduce the risk of overseas operations.

National Business Leaders Develop Policy Recommendations to Strengthen Minority-Owned Businesses

The National Advisory Council on Minority Business Enterprise (NACMBE) was established in 2011 to advise the Secretary of Commerce on key issues pertaining to the growth and competitiveness of the Nation's minority-owned businesses as defined in Executive Order 11625 and 15 C.F.R. § 1400.1. Specifically, they provide advice and recommendations on a broad range of policy issues that affect minority-owned businesses and their ability to successfully access domestic and global markets, such as:

methods for increasing jobs in the health care, manufacturing, technology, and "green" industries;

global and domestic business opportunities, challenges and constraints;

identifying and leveraging pools of capital for minority-owned and diaspora-owned businesses;

methods for increasing global transactions with entities such as the Export-Import Bank of the United States, the Overseas Private Investment Corporation and the International Monetary Fund among others.

The NACMBE is composed of 24 distinguished members from Fortune 500 corporations, the minority business community, business-focused non-profits and academia. These individuals were appointed by the Secretary of Commerce and are recognized leaders in their respective fields.

Congressional and Intergovernmental Relations Expand

In FY 2012, MBDA maintained an active presence on Capitol Hill and worked extensively with state and local officials to promote the job creation potential of minority-owned firms. MBDA met with numerous Members of Congress promoting the performance of the MBDA Business Center network as well as the opening of new centers. In particular, MBDA was pleased to have U.S. Rep. Steve Cohen (TN-09) present at the launch of the Memphis MBDA Business Center.

Recognizing the impact of state and municipal policies on businesses, MBDA maintains strong working relationships with groups such as the National Conference of State Legislators, U.S. Conference of Mayors, National Black Caucus of State Legislators, and the National Governors Association.

Increased Access to Capital through the Export-Import Bank of the United States

MBDA and the Export-Import Bank of the United States (Ex-Im Bank) announced a Global Outreach Alliance to increase access to capital for Sectorowned firms and encourage the participation of MBDA target companies in international markets. The agreement formalized an inter-agency partnership for providing substantial support to minority-owned firms and renewed a joint commitment to increase export revenues of a business sector that has the most favorable export attributes of any sector of the U.S. economy.

More than 85 percent of the Ex-Im Bank's transactions in recent years have been with U.S. small businesses. During FY 2012, the Ex-Im Bank authorized a historically high $838 million to support exports by 685 U.S. medium-sized and small businesses owned by minorities and women.

White House Engagement for Greater Access to Sector Companies

MBDA continued its work with the White House Business Council, which was formed by President Obama to obtain feedback directly from the Nation's business owners on what the Administration can do to create new jobs and to ensure businesses are aware of the programs and resources available through the Federal Government. In July 2012, MBDA National Director David A. Hinson hosted a White House Business Council Forum on Business in Indian Country. Acting Secretary of Commerce Rebecca Blank was a key participant and engaged in extensive dialogue with representatives of tribal governments, Native American and Alaska Native business owners. Dr. Blank addressed three core challenges identified by forum participants—preparing and retaining future leaders and entrepreneurs; raising capital for emerging businesses; and finding domestic and international markets for tribal commodities such as natural resources and agricultural products. In addition, Reta Jo Lewis, Special Representative, Global Intergovernmental Affairs, U.S. Department of State, offered expert guidance on business expansion through exports.

MBDA continues to work with Native American and Alaska Native representatives to develop specific programs that address these challenges.

Minority Enterprise Development Week Celebrates 30 Years

The National Minority Enterprise Development (MED) Week Conference has set the standard as the premier event for minority entrepreneurs, business owners, and advocates. In December, MED Week celebrated its milestone 30th Anniversary with one of the most successful events in the history of the conference.

The event was attended by nearly 1,300 individuals representing a broad range of industries from across the globe. In the State of Commerce Address, Acting Secretary of Commerce Rebecca Blank opened the conference with inspirational remarks on the growth of the economy and highlighted the crucial role that minority-owned businesses play in exporting and job creation.

The conference enabled attendees to delve into industry-focused topics, including advanced manufacturing, government contracting, mergers and acquisitions, and global emerging markets. Conference attendees also had access to MBDA's signature Business-to-Business Expo and one-on one business matchmaking sessions from public and private sector

Implementing a Global Strategy for MBDA and its Clients

For 44 years, MBDA has been a catalyst for private sector job creation through businesses focused on domestic operations in the United States. Today, many of the Agency's clients create and preserve American jobs by exporting products and services around the world. To better support those clients, MBDA has developed a Global Business Strategy which serves as the foundation of a new and exciting direction for the Agency.

MBDA plans to double its impact on job creation and retention over the next five years by generating over $1 billion in international contract opportunities for target companies.

MBDA Global Business Development Activity

MBDA works to increase export opportunities for Sector firms in the following countries

The strategic decision to establish a global focus for the Agency was driven by a number of key factors:

Outstanding Export Capabilities of MBDA Target Clients

MBDA's target clients possess the best export capabilities of any sector of the U.S. economy. According to the U.S. Census Bureau and other statistical data, MBDA target clients are:A

Twice as likely to export as non-sector companies

Three times as likely to have international operations

Six times as likely to transact business in a language other than English

Export leaders in 14 of 19 key industry sectors

Over the past three years, MBDA has experienced an increase in client requests for assistance with exporting, which was a key factor for our new global focus. Because many minority-owned and diaspora-owned businesses have familial, personal and businesses relationships in foreign countries, providing export assistance has high returns for the U.S. In addition, with the other competitive advantages MBDA target companies have in exporting such as cultural knowledge, knowledge of local business practices and access to asymmetric market opportunities, export assistance provided to MBDA target clients represents a tremendous value add to the U.S. economy.

Strong Business Case Management Skills

MBDA has demonstrated some of the strongest business case management skills of any entity in the Federal Government. The Agency has four decades of experience working with individual companies and seasoned senior management teams. In addition, the Agency has an internal culture based on executing and verifying contract and capital transactions. The Agency also possesses a solid track record of superior performance. Export support services fit well within the Agency's skill set.

MBDA represents a sector of the economy with unique advantages in the global marketplace. Many of these advantages are well documented:

Cultural knowledge and cultural sensitivity to a home country or region which allows for easier market entry;

Language capabilities that allow for direct and intimate communication with prospective business partners;

Existing family relationships that allow for easier access to critical market intelligence;

Deep understanding of local or regional business practices that reduce the risk of mistakes, misunderstandings or poor sequencing within the business development process; and

A general comfort with operating in a global environment that allows for greater discernment of business risk versus market risk.

MBDA Market Entry Strategies

To maximize the competitive advantages of MBDA 's target clients, the Agency intends to use three primary market-entry strategies to support new job creation through exporting:

Accelerating Economic Recovery through Exports

Build it here. Sell it everywhere. In order to fulfill its mission, MBDA works just as hard to pave the way for sector businesses in foreign markets as it does to connect them with resources in the U.S. The Agency promotes the interests of its clients in meetings with governments around the world, and alerts clients to opportunities that may only be available for a limited time.

According to the World Bank, Africa's GDP totaled approximately $1.25 trillion in 2011,E and six of the 10 fastest growing economies in the world are located there.

Brazil

As part of the Agency's ongoing global efforts, National Director Hinson traveled to Brasilia and Sao Paulo to meet with senior government officials and key business leaders in August of 2012. The purpose of his trip was to discuss how U.S. firms can take greater advantage of commercial opportunities in Brazil as a result of the upcoming World Cup and Olympics. The visit was held in conjunction with the technical meeting of the U.S.-Brazil Joint Action Plan, a high-level bilateral initiative led by the U.S. Department of State. The initiative seeks to foster greater involvement of the Afro-Brazilian community in the vast economic opportunities that exist throughout the country. Director Hinson has since developed an innovative framework for greater collaboration between the Department of Commerce and the Government of Brazil, designed to lead to greater market access for MBDA clients and export-ready firms.

Hosted by the Brazilian Ambassador to the U.S.,Mauro Vieira, at the Inter-American Development Bank in Washington, DC, a business networking reception was conducted for minority business owners to become familiar with the many opportunities Brazil has to offer. In addition, the San Antonio MBDA Business Center received supplemental funding to establish a Global Business Development Center that will serve as a valuable resource for our clients doing business in Brazil and other key markets in Latin America.

South Africa

In June 2012, the President issued a U.S. Strategy toward Sub-Saharan Africa. Sub-Saharan Africa presents enormous opportunities to the American private sector. According to the World Bank, the region's GDP totaled approximately $1.25 trillion in 2011, and six of the 10 fastest growing economies in the world are located on the continent. U.S. total merchandise exports to Sub-Saharan Africa tripled between 2001 and 2011.

Acting Secretary of Commerce Rebecca Blank traveled to South Africa in November to advance key elements of the President's strategy. While there, she launched the U.S. "Doing Business in Africa" campaign, an Obama Administration initiative to help American businesses identify and seize opportunities that will further the United States' commercial, trade, and investment relationship with Africa.

Export Opportunities for MBDA Clients

Few of the Agency's clients would be able to meet directly with high-level foreign officials without the support of MBDA. By representing the concerns of the multiple Sector businesses in countries around the world, MBDA removes obstacles and identifies opportunities that help clients operate more effectively in foreign lands.

Performance by State

MBDA works throughout the Nation to link Sector businesses with the capital, contracts, and markets they need to grow.

The Agency provides services to individual businesses in every state, and it also works closely with state and local governments to ensure that MBDA clients have a fair chance to compete for public projects that improve the quality of life for citizens and businesses alike.

Nationwide, MBDA clients created and/or saved 16,730 jobs in FY 2012.

Business Center

OPERATOR/GRANT RECIPIENT

FY 2012 Jobs Created and Retained

Congressional Distinct

Mobile MBDA Business Center

Mobile Area Chamber of Commerce

526

AL-01

Phoenix MBDA Business Center

Arizona Hispanic Chamber of Commerce

387

AZ-09

Arizona NABEC

National Center for American Indian Economic Development

159

AZ-06

Fresno MBDA Business Center

Asian, Inc.

28

CA-22

Los Angeles MBDA Business Center

University of Southern California

510

CA-37

Riverside MBDA Business Center

Southern California Corporate Growth Partners

286

CA-41

San Jose MBDA Business Center

Asian, Inc.

657

CA-17

Denver MBDA Business Center

Rocky Mountain Minority Supplier Development Council

1,433

CO-01

MBDA Federal Procurement Center

Metropolitan Economic Development Association

71

At-Large

Washington DC MBDA Business Center

National Community Reinvestment Coalition

68

At-Large

Miami MBDA Business Center

M. Gill & Associates, Inc.

383

FL-27

Orlando MBDA Business Center

Florida Minority Supplier Development Council

487

FL-05

Atlanta MBDA Business Center

Georgia Tech Research Corporation

890

GA-04

Honolulu MBDA Business Center

University of Hawaii

317

HI-01

Chicago MBDA Business Center

Chicago Minority Business Development Council, Inc.

365

IL-07

Indianapolis MBDA Business Center

Indiana Minority Supplier Development Council

964

IN-07

New Orleans MBDA Business Center

Louisiana Minority Business Council

0

LA-02

Boston MBDA Business Center

Greater New England Minority Supplier Development Council

171

MA-07

Detroit MBDA Business Center

Michigan Minority Supplier Development Council

3,284

MI-13

Minneapolis MBDA Business Center

Metropolitan Economic Development Association

201

MN-05

Raleigh MBDA Business Center

North Carolina Institute of Minority Economic Development

261

NC-04

Bismarck MBDA Business Center

United Tribes Technical College

20

At-Large

Santa Fe MBDA Business Center

American Indian Chamber of Commerce of New Mexico

38

NM-03

Albuquerque MBDA Business Center

NEDA Business Consultants, Inc.

154

NM-01

Las Vegas MBDA Business Center

New Ventures Capital Development Company

206

NV-01

New York City MBDA Business Center

National Community Reinvestment Coalition

324

NY-10

Williamsburg MBDA Business Center

ODA Community Development Corporation

340

NY-07

Cleveland MBDA Business Center

The Commission on Economic Inclusion

182

OH-11

Tulsa MBDA Business Center

Rural Enterprises of Oklahoma, Inc.

13

OK-01

Philadelphia MBDA Business Center

The Enterprise Center

335

PA-02

Puerto Rico MBDA Business Center

Asociacion Productos de Puerto Rico, Inc.

1,360

At-Large

Columbia MBDA Business Center

DESA, Inc.

287

SC-06

Memphis MBDA Business Center

Mid-South Minority Business Council Continuum, Inc.

134

TN-09

Dallas MBDA Business Center

Dallas Fort Worth Minority Supplier Development Council

435

TX-33

El Paso MBDA Business Center

El Paso Hispanic Chamber of Commerce

512

TX-16

Houston MBDA Business Center

National Community Reinvestment Coalition

71

TX-07

San Antonio MBDA Business Center

University of Texas at San Antonio

778

TX-20

Seattle MBDA Business Center

Seattle Business Assistance Center

93

WA-09

MBDA Business Center Program

MBDA administers and manages a competitive cooperative grant program to operate its national network of MBDA Business Centers. Our partners are state and local governments, tribal entities,
and universities including minority-serving institutions and for-profit entities. The MBDA supports centers with a national team of business development specialists.

Detailed Job Creation and Retention by State - View Performance by State

ACCESS TO CAPITAL

Minority-owned firms are less likely to obtain loans than non-minority owned firms and typically receive financing in lower amounts and at less favorable terms. After a thorough client assessment focused on business profitability, stability, and solvency, MBDA business development specialists and MBDA Business Center experts work with the client to determine the appropriate capital structure and tactical approach to obtain the capital needed. Services include:

Identifying financing opportunities sourcing deals

Financing forums and networking events

Strategic alliances with banks and financial institutions

Brokerage of financial transactions

Identification and closure of mergers and acquisitions

ACCESS TO CONTRACTS

MBDA staff and MBDA Business Centers collaborate to provide procurement assistance to help minority-owned firms do business with the Federal, state, and local governments as well as private corporations. Contract services include:

APPENDIX C - MBDA Performance Metrics

1. Number of Jobs Created The number of new full time and/or part time positions reported on the client's payroll during the funding year. Persons on paid sick leave, paid holiday and paid vacations are included as employees, as are salaried officers and executives of corporations. However, proprietors and partners of unincorporated businesses are not considered employees under this definition.

2. Number of Jobs Retained The number of existing full time and/ or part time employee positions retained and reported on the client's payroll during the funding year. Job retention pertains to maintaining the status quo of persons employed by the client in lieu of subjective and objective decisions made by the client to reduce its work force due to economic conditions, lack of capital, failure to secure necessary contracts and/or sales. Persons on paid sick leave, paid holiday and paid vacations are included as employees, as are salaried officers and executives of corporations. However, proprietors and partners of unincorporated businesses are not considered employees under this definition.

3. Dollar Value of Awarded Contracts and Procurements This represents the total dollar value of successfully awarded contracts and/or the total principal value of executed sales/delivery contracts of services/products/intellectual rights and/or other binding financial considerations secured by clients of the MBDA Business Centers, with the assistance of Center staff. For purposes of this performance element, Dollar Value of Awarded Contracts and Procurements are those transactions which have a specific dollar value, and which produce a commercial benefit for the client firm.

4. Number of Contracts The number of awarded contracts and other binding procurement awards secured by client firms.

5. Dollar Value of Awarded Financial Transactions The total principal value of approved loans, equity financings, bonds, leases (property and equipment), assets under management or other binding financial agreements secured by clients of the MBDA Business Centers with the assistance of Center staff.

6. Number of Financial Transactions The number of successful financial transactions secured by client firms.

7. Return on Taxpayer Investment The total value of contracts and capital obtained by clients as a result of their work with MBDA divided by the Agency's fiscal year budget appropriation.

8. Number of Clients Served The actual number of clients served in a funding period. Clients are defined as those that have registered with the MBDA Business Center and completed a written engagement for specific services. Clients may be counted only once during the program year. Clients from a prior program year may be counted in a subsequent program year if continued service provision to said clients is documented.

9. Number of Export Transactions Facilitated The number of global contract opportunities and export financing transactions secured by client firms as a result of direct assistance from an MBDA Business Center.

10. Number of Strategic Transactions Facilitated The number of awarded transactions secured by clients that included successful MBDA Business Center facilitation of joint ventures, teaming arrangements, and/or the number of mergers and acquisitions brokered on behalf of clients by the Center.

11. Number of Referrals The number of referrals made by the Center to clients seeking assistance that is outside the scope of MBDA Business Center program services. Referrals may be made to strategic partners or other external service providers able to provide services that are relevant to the client.

12. Management Assessment MBDA's overall evaluation of the MBDA Business Center, based on the Agency's internal review of the Center's operations. The management assessment focuses on such areas as the development of written service engagements and work plans; proper staffing; adherence to scheduled work hours; record keeping; successful completion of Agency training; customer relationship management, maintenance of strategic partnerships; market promotion and any other areas MBDA may deem to be relevant in determining the overall quality of the Center's operations. An operator may also lose up to two points from the assessment if the MBDA Business Center staff fails to participate in the required training credit hours.

13. Promotion of MBDA The extent to which MBDA Business Centers meet and exceed the requirements for communication of the mission and objectives of MBDA within the business and government community.

14. Diaspora Commonly defined as "any group that has been dispersed outside its traditional homeland."

References †

MBDA performance data is maintained in the Agency's CRM and legacy databases and was retrieved for this report on January 25, 2013.

A United States. Department of Commerce. Census Bureau, 2007 Survey of business owners, June 2010

F United States. Department of Commerce. International Trade Administration. Product profiles of U.S. merchandise trade with a selected market. Retrieved 5 March 2013 from the International Trade Administration website:http://tse.export.gov/TSE/TSEhome.aspx[33]

G United States. Census Bureau, 2007 Survey of business owners. Data specially compiled for MBDA on 25 January 2013 by Antony Caruso, Company Statistics Division.

I United States. Department of Commerce. International Trade Administration. Global patterns of a state's exports. Retrieved 5 March 2013 from the International Trade Administration website: http://tse.export.gov/TSE/TSEhome.aspx[33]